Party reservations hold up coalition deal

Greece edged on Tuesday toward a coalition government between New Democracy, PASOK and Democratic Left but the conclusion of a deal was held up by internal wrangling in the latter two parties.

It is expected that disagreement within PASOK and Democratic Left will be cleared up on Wednesday and that an agreement on the new administration?s policy program as well as who will enter the Cabinet will be agreed.

New Democracy?s Antonis Samaras, PASOK?s Evangelos Venizelos and Democratic Left?s Fotis Kouvelis are expected to hold their final talks on Wednesday before a deal is clinched. Samaras looks certain to become prime minister and he is thought to favor Vassilis Rapanos, the president of National Bank, as finance minister. Samaras is also considering the appointment of Christos Staikouras, an ND deputy and economics professor, as deputy finance minister in charge of revenues. The head of the IOBE think tank, Yannis Stournaras, is also being touted for a role in the new administration?s financial team.

However, internal party problems have to be overcome before the government can be formed. Venizelos is opposed to the participation of high-profile PASOK figures in the government. This, however, brought him into direct conflict with some of his party?s heavyweights, such as former ministers Andreas Loverdos and Michalis Chrysochoidis. Ex-Agriculture Minister Costas Skandalidis was among those who supported Venizelos?s cautious approach.

The issue was discussed between the PASOK leader and a seven-member party committee. The disagreement between PASOK officials led to the start of talks between representatives of the three parties in the would-be coalition being delayed. Officials from New Democracy, PASOK and Democratic Left met at about 8 p.m. to discuss the policy framework for the coalition government.

Loverdos and Chrysochoidis argued that PASOK?s poor showing in the elections, where it earned less than 13 percent, did not justify Venizelos taking such a strong line against his party?s frontline officials being involved in the government.

Venizelos is due to put the issue to his party?s 33 MPs during a meeting on Wednesday morning. The PASOK president met individually on Tuesday with some Socialist deputies. Sources said that most PASOK MPs agreed with Venizelos?s stance but were also concerned about non-political figures taking cabinet positions.

Despite the opening up of these internal fault lines, Venizelos said a coalition could be formed on Wednesday. ?I repeat that this government must be formed as soon as possible. The way things stand now, this could be achieved by tomorrow lunchtime,? he said, adding that PASOK ?will support the government honestly.?

Venizelos said the cabinet lineup was less important than creating a team that would be able to negotiate more favorable bailout terms with Greece?s lenders.

?The most crucial aspect is not who will be in the government but who will participate in the national negotiation team that will seek the most favorable review of the bailout,? Venizelos added.

The PASOK leader has proposed that this team could travel to Brussels every three months to discuss the details of the fiscal adjustment program, thereby avoiding the quarterly inspections by troika officials in Athens.

Earlier on Tuesday the PASOK chief said that leftist SYRIZA could have taken part in the negotiations, even if it was not part of a new coalition. SYRIZA immediately shot down the proposal as ?a publicity stunt.? Democratic Left appears keener on the idea.

PASOK officials have suggested that Nobel Prize-winning Cypriot economist Christopher Pissarides could be appointed to head this negotiating team.

Democratic Left leader Kouvelis is facing a similar conflict to Venizelos over the question of how actively his party should be involved in the coalition. Some members of the leftist group are against the idea of Democratic Left officials being appointed to the Cabinet. There were also calls for Kouvelis to object to the appointment of New Democracy officials such as former Transport Minister Makis Voridis due to his far-right past.

Kouvelis said the formation of a coalition was possible if an agreement could be found on a common policy platform and ?trustworthy personalities? to join the Cabinet. He added that he was waiting for political parties to respond to his policy proposals — chiefly, the extension of the fiscal adjustment program and the revocation of the toughest austerity measures, such as the reduction of the minimum wage.

Late on Tuesday night, Kouvelis reportedly told his party?s central committee that Democratic Left would not provide any personnel for the government but would support the coalition in Parliament. The leftists are likely to ask for some of the members of the caretaker administration, such as Interior Minister Antonis Manitakis and Labor Minister Antonis Roupakiotis, to stay on.

Meanwhile, SYRIZA leader Alexis Tsipras said he felt vindicated by the fact that all the parties, as well as European officials, were discussing renegotiating the terms of the bailout. ?What SYRIZA has been saying all along is that the bailout plan is not viable and cannot go on,? he told Reuters. ?Now they all recognize this.?

Tsipras, however, insisted that the leftists would be responsible in opposition and prepare to come to power soon. The SYRIZA leader said only his party could guarantee reforms such as cutting waste in the public sector. ?We have talked about the need to stop people collecting salaries for doing nothing, about reducing the number of ministers? advisers and government officials by half, and curtailing MPs? and ministers? wages and privileges.?

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